Gold Prices Skyrocket to Record High

Gold is sparkling at a new record high thanks to the unstable political and military situation in the Middle East.

Contact Editor

Chana Ya'ar, 02/03/11 11:06 | updated: 11:20

Gold coins (illustrative)

Israel news photo: Flash 90

The price of gold has skyrocketed due to the unstable political and military situation in the Middle East. Prices on the London Bullion Market reached a new all-time high Tuesday at $1,434.50 per ounce.

The new record, up from the previous record of $1,432.50 last December 7, came during trading at New York's COMEX exchange.

The riots that have spread across the Middle East and North Africa have driven the price of gold up by 6 percent in February alone. The reason: investors tend to view gold as a better shelter for their money during times of political instability.

Egypt has banned the export of gold for the next four months, until the end of June, “in light of the exceptional circumstances the country is passing through... to preserve the country's wealth until the situation stabilizes,” according to the nation's official Middle East News Agency (MENA).

However, an official from the flagship Sukari gold mine of Centamin Egypt said the ruling did not appear to be aimed at exports of gold from mining. “I know 100 percent this is not a problem for us,” said Youssef el-Raghy, managing director of the Sukari mine. The ban is reportedly aimed at preventing former government officials and industry leaders from transferring gold or wealth out of the country, Reuters reported.

Silver is shining a little brighter these days as well, with the price of the precious metal climbing Tuesday to a 31-year high at $34.57 per ounce. The brought silver's year-to-date gain to 11.7 percent, reaching its highest level since 1980.

The price of crude oil is also rising as a result of the unrest, with Brent crude up 4.2 percent to $116.46 per barrel, and US light, sweet cruide up 3.7 percent to $100.52 per barrel.